Renting or Buying: What’s Best for Me Right Now?

March 18, 2022

A home that one owns is a dream for many. The decision of buying or renting a home is a complex one. With both the options having advantages and disadvantages the decision-making process becomes very difficult. In the end, what matters is how much you can spend at that moment.

Advantages and disadvantages of renting a home

Are you planning to rent a home? Take a quick look at the advantages and disadvantages of renting a home before you take the leap.

Advantages:

  • Financial flexibility: Weekly rent costs are lesser than mortgage payments. The homeowner is responsible for the payment of corporate fees and council rates, so you can save this money and invest elsewhere.
  • Mobility: If you need to change your area of residence for any reason, moving from one rented house to another is much easier. You do not need to face the hustle of finding a buyer or a new tenant.
  • Saving on repair cost: As the landlord is responsible for all repairs and maintenance, as a tenant you save on expenses related to maintenance and repair.

Disadvantages:

  • Increase in rent over time: All landlords hike the rent of the home periodically. If the rent of the house goes beyond your budget, you will need to look for another rental property.
  • Possibility of eviction: Leases are not permanent and in cases where the landlord wants to sell the property, they evict the tenants.

If the above advantages seem more lucrative and nullify the disadvantages for you, then renting a home is the most suitable option for you. No credit cash loans can come in handy in case you need some extra cash to pay the monthly rent.

Pros and cons of buying a home

Buying a home is a huge investment, both financially and emotionally. Before you take the plunge weigh the pros and cons of the investment.

Pros:

  • Stability and freedom: When you own a home, there’s no risk of eviction. You can also renovate the property as per your wish and rent it out when you want to.
  • Increase in value and equity: Property prices almost always see an upside tick. If you own a home, there is always price appreciation even if you are paying your mortgage. Your mortgage payments will build equity that you can subtract from the overall debt.
  • Deductions in tax liabilities: For properties that are income-generating, there are certain tax benefits that are associated. You can consult your tax expert to know about the various ways you can save tax by owning a home.

Cons:

  • Financial flexibility: You will have far lesser financial flexibility than before if you buy a home.
  • Associated costs: There are many overhead costs involved like council rates, tax, utility bills, maintenance, insurance, repairs, and many more.
  • Limited mobility: Moving from one place to another becomes difficult when you own a home.

Other important considerations

There are a few other factors that will determine your position and help you decide between renting and buying a home.

  • Your capacity to borrow: This depends on your income and any other debt. If you need some quick cash in hand, then quick cash loans can be very helpful.
  • Property market: The market goes through ups and downs. The current state of the market is an important factor to consider.
  • Your goals and circumstances: Your risk appetite, personal goals, and current circumstances play an important role in determining what is best for you.

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